The Price of Dishwashers Has Remained Relatively Constant While the Quality

question 18

Multiple Choice

The price of dishwashers has remained relatively constant while the quality of dishwashers has improved.The CPI

• A)is adjusted monthly to reflect the improvement in quality.
• B)is increased monthly to reflect the increased quality of dishwashers.
• C)has an upward bias if it is not adjusted to take account of the higher quality.
• D)has an upward bias because it does not reflect the increased production of dishwashers.
• E)should not take account of any quality changes because it is a price index not a quality index.

---

Definitions:

Wages Payable

Wages payable is a liability account that records the amounts owed to employees for work that has been performed but not yet paid.

Capital Lease Contracts

Lease agreements that transfer substantially all risks and rewards of ownership from the lessor to the lessee, effectively treated as a purchase.

Computer Software

Computer Software encompasses programs and operating information used by a computer, directing how the hardware processes data and performs tasks.

Bond Issue

The process by which a government, corporation, or other entity raises funds by issuing bonds to investors.